Lending to Irish households continued to fall in February, as demand for loans and mortgages continued to decline.
According to the Central Bank, total lending to Irish households fell back to €106 billion in February, the lowest level since July 2005. Household loan repayments exceeded drawdowns by €387 million during February 2014, following a net monthly decrease of € 824 million in household loans in January
The most substantial decrease was for mortgages, which fell by €340 million over the month.
On an annual basis, lending to Irish households also continued to fall, decreasing by 3.8 per cent in February 2014, compared with an annual decline of 4.1 per cent in January 2014. Loans for house purchase, which account for 78 per cent of total household loans, declined at an annual rate of 3.1 per cent. Lending for consumption and other purposes declined by 6.3 per cent over the year.
Lending to businesses also fell, with loan drawdowns exceeding repayments for the 14th consecutive month of consecutive monthly declines.
When it comes to deposits, the statistics show that Irish people have started to save less. On an annual basis, deposits from Irish households fell by 0.8 per cent in the 12 months to February, and fell by €136 miillion inFebruary alone.
However, total deposits continue to increase, with deposits from the Irish resident private sector increasing at an annual rate of 7.7 per cent in February 2014, following a rise of 6.9 per cent in January. This is despite a monthly outflow of €219 million in February, which was mainly due to a fall in deposits from insurance corporations and pension funds of €388 million, the Central Bank said.
When it comes to non-resident private sector deposits, a decline of 473 million was noted in February, driven by an €854 million decline from non-euro area residents, the majority of which was withdrawn from IFSC banks.
